The extra‐territorial reach of the broker‐dealer registration requirements under the US Securities Exchange Act of 1934: the staff of the Securities and Exchange Commission addresses frequently asked questions regarding Rule 15a‐6 and foreign broker‐dealers

Edward Eisert (Partner at Orrick, Herrington & Sutcliffe LLC, New York, New York, USA)
Tony Katz (Partner at Orrick, Herrington & Sutcliffe LLC, London, UK)
Giovanni Carotenuto (Partner at Orrick, Herrington & Sutcliffe LLC, London, UK)
Melanie F. Ball (Associate at Orrick, Herrington & Sutcliffe LLC, London, UK)

Journal of Investment Compliance

ISSN: 1528-5812

Publication date: 28 June 2013

Abstract

Purpose

The purpose of this paper is to summarize the significant responses of the staff of the SEC to 16 frequently asked questions (FAQs) which supplement prior guidance on Rule 15a‐6 under the Securities Exchange Act of 1934.

Design/methodology/approach

The paper lists Rule 15a‐6 activities, refers to prior guidance on the rule, and summarizes the following issues, among others, covered in the FAQs: transactions between a foreign broker‐dealer and a person temporarily in the USA, distribution by a foreign broker‐dealer of research reports to major US institutional investors, activities of foreign broker‐dealers taken with unaffiliated registered broker‐dealers, boundaries to the definition of “solicitation” by a foreign broker‐dealer of a US investor, and minimum net capital requirements for a registered broker‐dealer in a chaperoning arrangement with a foreign broker‐dealer.

Findings

This guidance does not break new ground and may be supplemented in the future. An amendment of Rule 15a‐6 is still necessary to address its fundamental limitations.

Originality/value

The paper provides practical explanation by experienced financial services lawyers.

Keywords

Citation

Eisert, E., Katz, T., Carotenuto, G. and Ball, M. (2013), "The extra‐territorial reach of the broker‐dealer registration requirements under the US Securities Exchange Act of 1934: the staff of the Securities and Exchange Commission addresses frequently asked questions regarding Rule 15a‐6 and foreign broker‐dealers", Journal of Investment Compliance, Vol. 14 No. 2, pp. 50-56. https://doi.org/10.1108/JOIC-05-2013-0017

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Publisher

:

Emerald Group Publishing Limited

Copyright © 2013, Authors

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